Where To Sell Your Coins
I thought it was time to write a few words about possible avenues to sell your coins. Good material has been in thin supply amongst dealers for a little while now, in fact this is true throughout the trade. There are a number of things to consider when selling including how to realise the best price or lose the least value in costs, how quickly you want the sale to be, how public or private etc.
So what does it cost to sell or how much can you expect to lose in fees? An increasing amount of material seems to be going via the auction route, perhaps with the perception that the middle-man is cut out and that the final realisation after costs will be better. It is interesting to note that a well-known London auction house has recently increased their buyer’s premium to 24% + VAT, up from 20% + VAT. Years ago, there was no such thing as buyer’s premium, after all, the auction house is working on behalf of the seller not the buyer, and so surely charges should be openly levied on that party. ‘Openly’ is a key word here because the buyer’s premium is effectively levied on the vendor anyway. Back in 1970 Glendinings were charging a seller’s commission at the rate of 12.5% and no buyer’s premium and this was typical of charges at that time, and when Spink began their auctions in 1978 they were charging 15% seller’s commission and again, no buyer’s premium. By the mid-80’s someone had had the bright idea to charge both a seller’s and buyer’s commission often about 10% each at the time. Over time the buyer’s premium has increased, to 15%, 20% and now in some cases more whilst for the most part retaining some seller’s commission too.
Vendors do not always realise. They are of course told their seller’s fee which may be in the range 0 – 15% but the buyer’s fee is something else, this is paid by the buyer – not so! If we take a coin which has an approximate retail value of £1000 and this is submitted to auction as a single item, the vendor might be charged 15% seller’s fee. If the buyer of the coin pays the retail value in total, then with a buyer’s premium of 24% + VAT his/her bid will be £776. The vendor is then charged 15% + VAT of this value and receives back £657 for a coin worth £1000, which means 34.3% (less the VAT) of the coin’s value goes to the auction house. Auction houses need to charge VAT in the UK as they are performing a service and this is taxable at the standard VAT rate.
Costs of third party bidding platforms have also increased. A major auction platform has recently put up charges from 3% to 6% + VAT. To be fair some of the major London coin auctioneers have their own free bidding platforms but should a buyer decide to bid via a third-party platform such as this then that is another 7.2% to allow for.
Whilst the coin market is currently still fairly solid (Aug 2019) traditional dealers are finding it difficult to procure decent stock, and to put it plainly, if you haven’t got it you can’t sell it! This remains somewhat of a mystery to me. For stock that we purchase we typically make less margin (sometimes much less) than the 34% figure above and for this the vendor is getting instant payment and a completed transaction, we also take on the risk of paying for and owning the piece in question. For higher value coins we often sell for a TOTAL commission rate of 10% + VAT for clients (12%) and so a full 22% less than above! Furthermore dealers in general offer other personal services particularly to buyers such as taking returns, helping out with wants lists etc.
Regarding the speed of sale, if a coin is offered to a dealer for immediate sale then with a matter of days it can be agreed and paid for. When a coin is placed into auction it typically has to be submitted months or at very least weeks in advance in order for the auction house to catalogue the item and prepare and print the catalogue etc. Selling through a dealer on commission can of course take as long or in some cases longer should the item not sell quickly.
Some collectors like the thought of seeing his/her collection presented and documented in one place, perhaps named, and this is understandable and something suited well to the auction route. It should be noted that for a good collection (named or otherwise) AMR Coins would be delighted to offer to produce a high quality printed catalogue to be made available at fairs and to circulate amongst our clients. In addition, coins would be made available on the website and can be listed under a separate named section if required.
To summarise, it is important to take many factors into account, not least the charges incurred by selling at auction, I personally see no reason for auctioneers to raise premiums still further, it doesn’t seem fair to the vendor when they have spent years collecting only to have a good percentage of value of their collection taken away at the point of sale. I would seriously urge anyone selling a good collection to think twice about how it is handled and to do their homework. At least speak to both dealers and auction houses alike.